Brian MacArthur

Brian MacArthur asked for an update on Centerra's strategy to realize value from the Endako mill, considering its substantial molybdenum resource and the current market environment. He also inquired if the company would consider selling the mill.

Answer

President and CEO Paul Tomory stated that Endako, with its significant molybdenum resource and process plant, is currently slated to come online after the Thompson Creek mine is depleted, approximately 10 years from now. He added that the company would consider selling the mill "at the right price."

Brian MacArthur asked for an update on the Endako mill, inquiring about its potential to highlight value given Centerra's other growth projects, and whether the company would consider selling the mill.

Answer

Paul Tomory, President and Chief Executive Officer, stated that the current strategy involves reopening Thompson Creek first, with Endako coming online after Thompson Creek is mined out, approximately 10 years from now, though this could be reassessed. He also indicated that Centerra might consider selling the Endako mill 'at the right price.'

Brian MacArthur asked about the funding for Hod Maden this year to maintain Royal Gold's interest, specifically if significant capital would be required this year and if Royal Gold aims to restructure the interest before substantial capital contributions become necessary.

Answer

Bill Heissenbuttel, President and CEO, agreed that restructuring the Hod Maden interest before significant capital is the best outcome. He stated that the exact spending for this year is dependent on when the investment decision is made, as SSR Mining's projected spending would increase after a decision, and more clarity is expected later.

Brian MacArthur sought clarification on Hod Maden funding for the current year, specifically whether significant capital expenditure is still a few years out, which would allow time for restructuring the joint venture interest.

Answer

Bill Heissenbuttel, President and CEO, agreed that restructuring the Hod Maden interest before significant capital investment is the preferred outcome. He noted that this year's spending depends on the timing of the investment decision, as SSR Mining projects a 2-3 year construction period. He could not provide a specific spending figure for the year without more clarity on the decision timeline.

Brian MacArthur asked for clarification on the 1.6% equivalent royalty rate for Four Mile, specifically whether it's a consistent rate or a variable combination of different royalty interests. He also sought to confirm that the 5,000-ounce deferral for the Constantian stream was purely a timing issue, not a permanent loss of ounces.

Answer

Bill Heissenbuttel (President and CEO, Royal Gold) confirmed that the 1.6% royalty rate for Four Mile is a consistent, simple rate derived from the Idaho royalty acquired in late 2022, separate from legacy interests. He also reiterated that the 5,000-ounce deferral for Constantian is solely a timing issue, with all ounces eventually delivered.

Brian MacArthur of Raymond James sought clarification on the Cactus royalty, asking if the delayed payment start in 'year 5' was due to mine sequencing rather than a complex royalty structure, and inquired about the mechanics of recovering deferred silver ounces from Pueblo Viejo.

Answer

President and CEO William Heissenbuttel confirmed the delayed revenue from Cactus is based on the expected mine plan and not a complex or checkerboard royalty structure. Regarding Pueblo Viejo, he explained that deferred ounces begin to be recovered once silver recovery rates exceed 52.5%, but cautioned that the net value received would be reduced by the 30% of spot price payment and the settlement of previously deferred cash payments, resulting in a net value of roughly 35-40% of the gross silver price.

Brian MacArthur from Raymond James asked for clarification on the duration of Coeur Mining's U.S. tax pools (NOLs), specifically if they would last for several years or be depleted quickly given current profitability, and if the guidance assumes full depletion at some point. He also pressed for a timeline on when the percentage of Palmarejo's production outside the Franco-Nevada stream would substantially increase, dropping below the current 40-50% range, given the discovery of new off-stream ore.

Answer

CFO Tom Whelan explained that U.S. tax pools were down to $530 million from $630 million year-over-year, indicating about $100 million used last year. He estimated that at current prices, the remaining pools might last approximately two more years, with some cash tax still being paid due to limitations allowing only 80% sheltering in certain years. President and CEO Mitchell Krebs and CFO Tom Whelan stated that for the near future, virtually all Palmarejo production would remain subject to the Franco-Nevada stream. Mitchell Krebs added that while exploration efforts are increasingly focused off-stream to the east, building out more runway, a slow transition to higher off-stream production would occur over time as these new deposits are better defined and developed.

Brian MacArthur asked for clarification on the U.S. tax pools, specifically how long the substantial Net Operating Losses (NOLs) are expected to last given current profitability, and if low U.S. taxes can be expected for several more years. He also followed up on Palmarejo's new off-AOI ore discoveries, asking when the percentage of production subject to the Franco stream might substantially drop from the current 40-50% range, and what the sequencing might look like.

Answer

Tom Whelan (CFO) referred to the 10-K tax note, indicating that U.S. NOLs are down to $530 million from $630 million, suggesting about $100 million was used last year. He estimated that at current prices, the remaining NOLs might last approximately two more years, with limitations allowing only 80% sheltering in some years, leading to some cash tax payments. Regarding Palmarejo, Tom Whelan stated that while exploration is focused on off-AOI areas, virtually all production will remain subject to the Franco stream for the near future. Mitchell Krebs (President and CEO) added that significant reserve and resource increases at Palmarejo provide a longer runway, allowing more exploration capital to be allocated to the east to develop future production profiles, with a slow transition over time.

Brian Macarthur of Raymond James sought clarification on the company's tax assumptions for free cash flow calculations, particularly concerning U.S. operations and the utilization of Net Operating Losses (NOLs).

Answer

SVP & CFO Thomas Whelan confirmed that for cash tax purposes, it is appropriate to assume a standard rate for Mexico and a zero tax rate for the U.S. for the time being. He noted that while the company is beginning to utilize its significant NOLs, this modeling approach remains the most accurate.

Brian MacArthur of Raymond James sought confirmation on the non-cash accounting impacts from the Las Chispas acquisition, including inventory and deferred taxes. He also asked if one-time cash outflows were now complete and questioned the priority between shareholder returns and major Silvertip investments.

Answer

CFO Thomas Whelan confirmed the inventory and deferred tax accounting adjustments will impact net income but not cash flow. Executive Mitchell J. Krebs affirmed that Q1 cleared the deck of one-time cash items and agreed that near-term shareholder returns could be considered before a major investment decision on Silvertip, given the strong free cash flow outlook.

Brian MacArthur questioned the assumptions for Mantos Blancos in the 2030 outlook, specifically asking if it assumes flat production given the reconciliation issues observed.

Answer

CEO Jason Attew confirmed that the 2030 outlook for Mantos Blancos is effectively flat compared to the performance seen in 2025 and the expectations for 2026.

Brian MacArthur from Raymond James inquired about the assumptions made for Mantos Blancos within Osisko Gold Royalties' 2030 outlook, specifically given the observed reconciliation issues.

Answer

Jason Attew, CEO of Osisko Gold Royalties, confirmed that Mantos Blancos was assumed to be effectively flat to its 2025 performance and 2026 expectations within the 2030 outlook.

Brian MacArthur of Raymond James asked for more detail on the security arrangements for the Eagle Mine royalty, specifically questioning if Osisko's position in the intercreditor agreement is pari-passu with the senior lending syndicate to better understand the company's relative negotiating power in a restructuring scenario.

Answer

Jason Attew, President and CEO, responded that while the specific details of the intercreditor agreement are confidential, management is highly confident in its protections. He reiterated that Osisko is a secured creditor with security over the property and a registered interest in the land. Attew expressed confidence that Osisko's rights would be upheld and continue upon a restart of the Eagle Mine, even if the operator were to go through a CCAA process.

Brian MacArthur requested more detail on the security Osisko holds on the Eagle Mine, specifically asking if its intercreditor agreement places it pari-passu with the senior lending syndicate, in order to better understand the company's relative negotiating power in a potential restructuring.

Answer

Jason Attew, President and CEO, stated that while the specific details of the intercreditor agreement are confidential, Osisko is very confident in its protections. He reiterated that the company is a secured creditor with security over the property and a registered interest in the land with the Yukon Territory, giving them confidence that their royalty rights will continue upon a restart of the mine, even through a CCAA process.

Brian MacArthur asked for an update on the ATO (Amulsar) project, specifically its assumed contribution to the 2026 guidance and 2030 outlook, and whether it reflects an expansion or baseline scenario.

Answer

Sheldon Vanderkooy (CEO) confirmed that the ATO project is currently in litigation, and while Triple Flag is confident in its position, it has been entirely removed from both the 2026 guidance and the 2030 outlook to avoid investor distraction. He emphasized that any future contribution from ATO would represent pure upside to the stated figures.

Brian MacArthur requested an update on the ATO project, specifically asking about its assumed contribution to the 2026 guidance and 2030 outlook, given its ongoing litigation status.

Answer

CEO Sheldon Vanderkooy confirmed that ATO is currently in litigation, and while Triple Flag is confident in its position, the project has been removed from both the 2026 guidance and 2030 outlook to avoid investor distraction. He clarified that ATO's potential contribution now represents only upside to the published figures.

Brian MacArthur of Raymond James Financial, Inc. requested an update on the prepay agreement with Steppe Gold, specifically asking about the status and the likelihood of receiving the remaining ounces in the current year.

Answer

Executive Sheldon Vanderkooy confirmed that Steppe Gold owes 1,650 ounces of gold. He stated that Triple Flag has denied further requests for delivery extensions and is now pursuing legal action to enforce payment, supported by a parent company guarantee. Vanderkooy expressed confidence in recovering the ounces, noting Steppe Gold's strong performance.

Brian MacArthur inquired about Indonesia's export duties (or lack thereof), the $0.43 per pound treatment charge (TC) guidance for 2026 and its accounting for internal smelter costs, and the implications of the Kucing Liar (KL) expansion (from 90,000 to 130,000 tons per day) on capital and pyrite processing deferral.

Answer

Kathleen Quirk, President and CEO, confirmed no export duties as concentrates are no longer exported. The $0.43 per pound TC reflects internal smelter costs and tolling fees, with byproduct benefits now in the revenue line. She explained that the increased KL rates are part of an optimization plan allowing the deferral of significant pyrite processing capital associated with Grasberg Block Cave, effectively substituting production within existing mill capacity. She also confirmed that the $0.43 TC for 2026 is inflated due to lower production during ramp-up and would be better on an ongoing basis.

Brian MacArthur asked about Indonesia's export duties (none in Q4 but TCs up to $0.43 in guidance), inquiring if export duties are included or if it's an inter-transfer of costs for the new smelter. He also asked about Kucing Liar (KL) expansion, its additive nature post-2030, mill capacity, and CapEx increases.

Answer

Kathleen Quirk, President and CEO, clarified that they are no longer exporting concentrates, so no export duties. The $0.43 TC reflects internal smelter costs and tolling fees, with byproduct benefits now in revenue. For Kucing Liar, she explained the plan optimizes between Grasberg Block Cave and KL operating rates, deferring significant pyrite processing capital. KL rates are increasing (90k to 130k tons/day), and Grasberg Block Cave is slightly smaller, but overall reserves will be realized with an extension. She confirmed the $0.43 TC is inflated this year due to lower production and ramp-up.

Brian MacArthur of Raymond James asked if the Grasberg gold variability would affect long-term plans beyond five years and if these learnings would alter the strategy for the high-gold-grade Kucing Liar (KL) project.

Answer

President & CEO Kathleen Quirk stated there is no change to long-range Grasberg plans and that the KL development adds valuable optionality to optimize NPV by sequencing ore bodies. She noted that KL's current recovery assumptions are conservative and represent an opportunity. Chairman Richard Adkerson reiterated that the Grasberg issue is a matter of timing, not a loss of resource, and its financial impact is mitigated by taxes and the non-controlling interest.

Brian Macarthur of Raymond James asked if the Grasberg gold grade revisions impact the long-term plan and if these learnings affect the strategy for the high-grade Kucing Liar (KL) project.

Answer

President & CEO Kathleen Quirk confirmed no change to the long-range Grasberg plan and noted that KL's development adds valuable optionality to maximize NPV. She highlighted that KL's currently lower recovery assumptions represent a future opportunity. Chairman Richard Adkerson emphasized the Grasberg gold issue is a matter of timing, not a loss of resource, with a financial impact mitigated by taxes and non-controlling interest.

Asked for clarification on the lower cost guidance, specifically whether it was solely due to higher gold prices or if it also assumed the elimination of the 7.5% Indonesian export tax in Q4 once the new smelter is operational.

Answer

The improvement in Indonesian cost guidance is mostly due to higher byproduct credits from gold prices. The company does not project paying an export duty in Q4 because they plan to use their internal smelters for processing, not because of an assumed change in the tax itself. This approach was consistent with previous estimates.

Sought clarification on the Indonesian 7.5% export tax, asking if it will apply for all of 2025 even after the smelter restarts mid-year.

Answer

The 7.5% tax applies to all exports per current regulations. As the smelter will ramp up in the second half of the year, there will still be some exports subject to the tax. The cost guidance for 2025 includes these duties. In 2026, assuming the smelter is at full capacity and there are no exports, the tax would be zero.

Brian MacArthur sought clarification on the 7.5% Indonesian export tax, asking if it will apply throughout 2025 even after the smelter restarts and if it will be eliminated in 2026.

Answer

President and CEO Kathleen Quirk confirmed that under current regulations, the 7.5% tax applies to all exports. While exports will decline in the second half of 2025 as the smelter ramps up, any exported volume will incur the tax. She affirmed that in 2026, assuming the smelter is at full capacity and there are no exports, the tax would be zero.

Brian MacArthur sought clarification on Öksüt's residual leach plans, specifically if it involves removing material or reusing current pads, and if it would be a low-capital, no-mining endeavor without sulfide extraction.

Answer

President and Chief Executive Officer Paul Tomory confirmed it would be a very low capital expense. Chief Operating Officer Dave Hendriks elaborated that the study would explore reshaping heaps, optimizing solution flow, and potentially adding ponds to increase preg grades. He emphasized the low capital for high return, expecting increased grades to plants and more ounces, with an iterative implementation process over 18-24 months.

Brian MacArthur sought clarification on the Öksüt residual leach, asking if it would involve low capital expenditure and no mining if sulfides are excluded, and if current leach pads could be reused. He also asked if better recoveries could be achieved in the later part of the current mine life (2028/2029) even before the study concludes.

Answer

Paul Tomory, President and Chief Executive Officer, and Dave Hendriks, Chief Operating Officer, confirmed that the residual leach would be very low CapEx. Mr. Hendriks explained it involves reshaping heaps, optimizing solution flow, potentially adding ponds/pumping, and minor permit modifications, with high return on capital. He anticipates increasing grades to the plants and getting more ounces earlier and later, with implementation taking 18-24 months.

Brian MacArthur asked about the go-forward strategy for the Goldfield project, whether it would be sold or held. He also requested an update on the potential for a partnership at the Molybdenum operations and asked about the mine life extension potential at the Oksut mine.

Answer

President and CEO Paul Tomory stated that Goldfield is being placed 'on the shelf' and the focus is now on strategic or commercial options, including a potential sale or JV. Regarding Molybdenum, he affirmed that while they are open to strategic outcomes, they view it as a high-return, strategic asset. For Oksut, he indicated that significant mine life extension from exploration is unlikely and the focus in Turkey is on greenfield targets.

Brian MacArthur sought clarification on the upcoming molybdenum study, asking how the economics of the Langeloth facility will be presented and whether the analysis will assume utilization beyond just processing Thompson Creek material, including third-party feed.

Answer

Paul Tomory, President and CEO, confirmed that the Langeloth facility is the principal value driver in their molybdenum strategy. The upcoming study will show the integrated economics of both Thompson Creek and Langeloth, assuming a ramp-up to much higher than 66% utilization. He explained that Thompson Creek's clean concentrate enables the blending and processing of third-party material to fill the roaster's full capacity.

Brian Macarthur inquired about the drivers behind the substantial increase in the Musselwhite NPI and asked for a reasonable forward-looking run-rate for the asset.

Answer

CFO Sandip Rana attributed the strong Musselwhite performance to gold price leverage, improved operations, and a minor catch-up payment from 2024. He suggested that approximately $4 million per quarter would be a reasonable expectation going forward.

Brian Macarthur inquired about the drivers behind the strong performance of the Musselwhite NPI and asked for a reasonable forward-looking run-rate for the asset.

Answer

CFO Sandip Rana explained that the Musselwhite NPI's strong quarter was driven by gold price leverage, better mine operations, and a small catch-up payment from 2024. She suggested that approximately $4 million per quarter would be a reasonable expectation going forward.

Brian MacArthur of Raymond James asked about potential volume changes affecting GEO guidance, the sustainability of Antapaccai's strong Q1 performance, the timing of the increased stream at Condestable, and the accounting for global minimum taxes.

Answer

CFO Sandip Rana confirmed that production volumes are in line with expectations and Antapaccai's performance should normalize while remaining within guidance. President & CEO Paul Brink clarified the Condestable rate change only affects the final rate with no near-term changes. Sandip Rana also detailed that the global minimum tax, once enacted, would trigger a one-time adjustment of approximately $47 million and raise the future effective tax rate to about 19%.

Brian MacArthur from Raymond James questioned if potential U.S. tariffs on gold could create a price arbitrage opportunity for Wheaton, and whether any contracts would prevent them from capitalizing on it.

Answer

SVP & CFO Vincent Lau and CEO Randy Smallwood confirmed Wheaton is insulated from such tariffs as it takes delivery of metal credits primarily in London. They noted that while it is too early to tell, the company has no contractual restrictions and would look for opportunities to benefit from any significant price differentials between markets like LME and COMEX.

Brian MacArthur of Raymond James questioned the structure of the larger $500 million to $1 billion deals being discussed, asking if they are pure streaming deals or part of broader funding packages, and what ratio the stream component typically represents in such packages.

Answer

SVP of Corporate Development, Haytham Hodaly, clarified that the $500 million to $1 billion figures refer specifically to the stream or royalty component, which is Wheaton's core business. He further explained that when participating in a broader funding package, Wheaton requires the stream portion to represent at least 80% of the total value it provides, ensuring the investment aligns with its primary business model.

Brian MacArthur from Raymond James asked about the philosophy behind recent amendments to purchase agreements, such as for Blackwater, questioning whether they are driven by partners' capital needs or a mutual opportunity to capitalize on strong metal prices, and if this represents a new avenue for growth.

Answer

SVP, Corporate Development Haytham Hodaly responded that Wheaton has become increasingly creative in structuring transactions to expand on high-quality streams. He explained these amendments provide additional protections for Wheaton and ensure value is received, even with partner delays, while confirming the security on these additional investments is as good as or better than the original.

Brian Macarthur of Raymond James sought confirmation on whether the offtake contracts contain volume options for either party. He also asked for clarification on the relationship between the financing timeline and regulatory approval, specifically if financing could be secured before the final CNSC decision.

Answer

CEO Leigh Curyer stated unequivocally that there is 'no volume discretion' in the contracts for either NextGen or the utility. On financing, he clarified that the two are directly related and that the company cannot fully trigger and conclude the financing package until final regulatory approval is received, after which it will be completed in 'short order'.

Brian Macarthur of Raymond James sought to confirm if the new offtake contracts include any volume options for either party. He also asked for clarification on the relationship between securing financing and receiving CNSC approval, questioning if financing could be arranged beforehand, subject to approval.

Answer

CEO Leigh Curyer confirmed there is 'no volume discretion' in the contracts for either the utility or NextGen. Regarding financing, he clarified that the two are directly related and that the company cannot trigger the financing until after receiving final regulatory approval, at which point it will be concluded in 'short order'.

Brian MacArthur of Raymond James questioned if the 4-year construction timeline could be accelerated post-approval or, conversely, if it could be extended due to previous delays. He also sought confirmation that sourcing primarily from Canada mitigates supply chain risk.

Answer

Chief Commercial Officer Travis McPherson stated the 48-month construction timeline, driven by the shaft sinking, is firm and cannot be materially accelerated. However, CEO Leigh Curyer noted the hearing delays have actually reduced execution risk by allowing for more refined planning. Curyer also confirmed that prioritizing Canadian and local sourcing is a key strategy that significantly de-risks the supply chain.

Brian MacArthur asked if the 2024 budget is part of the new CapEx, if the updated NPV calculation basis is consistent with the prior study, and whether the permit allows for production beyond 30 million pounds annually.

Answer

CEO Leigh Curyer confirmed parts of the 2024 budget for equipment are included in the total CapEx. CCO Travis MacPherson affirmed the NPV was calculated on a like-for-like basis with the Feasibility Study. Leigh Curyer clarified that any material increase beyond the permitted 30 million pounds per annum would require a subsequent amendment, so new discoveries are currently viewed as extending mine life.

Brian Macarthur of Raymond James questioned the confidence in getting the GLE enrichment facility operational by 2030 and whether the initial plan is still to process secondary uranium tails.

Answer

Executive VP & CFO Grant Isaac affirmed the focus remains on the 2030 timeline to re-enrich depleted UF6 tails under their agreement with the Department of Energy. He noted that while GLE could produce other products like LEU or HALEU, this would require specific commercial demand and contracts to underwrite the investment, making the tails agreement the primary path forward.

Brian MacArthur inquired if the Q4 uranium sales forecast of 11-13 million pounds already accounts for all potential upward flexibility in contracts, and asked if terms like volume options and notice periods are changing in new contracts.

Answer

Executive VP and CFO Grant Isaac clarified that Q4 volumes are essentially locked in due to binding delivery notices, leaving little room for upward surprises. He also confirmed that as the market tightens, new contracts feature less flexibility for buyers and more favorable terms for Cameco, such as longer notice periods and better pricing structures.

Brian MacArthur from Raymond James asked for an update on the prepay agreement with Steppe Gold and whether Triple Flag anticipates receiving the remaining 1,650 gold ounces within the current year.

Answer

CEO Sheldon Vanderkooy confirmed that Steppe Gold owes 1,650 ounces of gold. He stated that after granting previous extensions, Triple Flag is now taking legal action to enforce payment. Vanderkooy expressed confidence in recovering the ounces, citing a parent company guarantee and Steppe Gold's strong operational performance.

Brian MacArthur questioned the long-term guidance, specifically asking what causes the significant drop-off in the 'other' production category around 2027-2028.

Answer

Executive Nolan Watson attributed the 2027 decline to two main factors. First, the Woodlawn stream, acquired from Nomad, provides a significant production boost in 2026 but is a capped stream that concludes by the end of 2027. Second, there is a minor tailing off of the Cerro Moro stream during that same period.

Brian MacArthur questioned the long-term guidance, specifically asking for the reason behind the substantial drop-off in the 'other' assets category projected for 2027 and 2028.

Answer

Nolan Watson, an executive, explained that the primary driver for the decline in 2027 is the Woodlawn stream, a capped asset acquired from Nomad, which delivers significant value in 2026 before concluding by the end of 2027. He also noted that a minor tailing off of the Cerro Moro stream contributes to the decrease.

Brian MacArthur followed up on the Evolve royalty sale, asking where the potential proceeds are on the balance sheet. He also asked for clarification on the Versamet valuation, seeking to reconcile the stated $300 million enterprise value with the carrying value in Sandstorm's financials.

Answer

Executive Nolan Watson clarified that the $15 million from the Evolve sale was received as cash and the remaining $5 million is a pending payment that may not close; there is no Evolve asset on the balance sheet. CFO Erfan Kazemi-Esfahani explained the Versamet valuation difference by stating the investment is carried at cost, not mark-to-market, as per accounting rules, while the $300 million figure is the enterprise value.

Brian MacArthur of Raymond James asked for clarification on the Evolve royalty's accounting treatment on the balance sheet and sought to reconcile the stated $300 million enterprise value of Versamet with its carrying value in Sandstorm's financials.

Answer

Executive Nolan Watson clarified that the Evolve transaction was for cash, with $15 million received and the final $5 million pending, so it is not carried as an investment. CFO Erfan Kazemi-Esfahani explained the Versamet valuation discrepancy is because the investment is carried at cost on the balance sheet, which is an accounting requirement, whereas the $300 million figure represents the asset's enterprise value following a recent transaction.

Asked about the Fourmile project's processing plan, the reason for a long three-year pre-feasibility study, and the mechanics of the vend-in agreement with Newmont.

Answer

The Fourmile project has an obligation to be vended into the Nevada JV with Newmont based on a full market valuation. The three-year pre-feasibility study is part of the thorough evaluation required by the JV agreement. The project has superior geology and grade compared to Goldrush, and its inclusion would significantly enhance the Nevada complex's value. The goal is to work with Newmont to unlock this value soon.

Asked for a detailed review of the process and terms for vending the Fourmile project into the Nevada Gold Mines (NGM) joint venture, including the type of study required and control over the timeline.

Answer

The process is governed by the JV agreement. Fourmile would be vended into the JV if a feasibility study shows it meets a 15% IRR hurdle. The valuation would be market-based, crediting the project with the use of existing NGM infrastructure. Barrick is currently focused on defining the project's full potential for its own shareholders before making any decisions.